The Ultimate Guide To Unified ID 2.0

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There’s one thing that powers the entire programmatic advertising[1] industry — user data[5]. Certain pieces of user information are essential to identifying the target audience for advertisements. And so far, the industry has mainly relied on cookies for the collection of user data. But the lack of a standardized solution for user identification across all platforms (from smart TVs to mobile applications) has often resulted in a loss of user data. 

While identifying users, every ad-tech partner synchronizes their third-party cookies with each other. This inevitably affects the user experience, with slower page loading speeds and reduced match rates. Plus, the changes that are coming with Google’s evolving cookies policy will result in some necessary changes to the status quo. 

All of this has led to demand for universal user IDs — standardized through a shared identifier that can trace users across different websites and platforms without resorting to cookie[6] syncing. Plenty of companies have tried to create the universal successor to cookies — and The Trade Desk’s Unified ID is one of the best contenders. 

What is Unified ID — 1.0 and 2.0?

The first Unified ID 1.0 was introduced by The Trade Desk in 2019. Its purpose was to eliminate the need for cookie-syncing, and help the programmatic marketing industry identify its audiences more precisely.

Theoretically, all the players in the advertising ecosystem could perform audience targeting[7] through the users’ unique universal identifier — UID 1.0. For the publishers that adopted UID 1.0, the result was bigger match rate growth (due to the absence of cookie synching) and less user data loss. 

There was only one problem — UID 1.0 was completely dependent on third-party cookies. That’s the main reason The Trade Desk released an updated version, Unified ID 2.0[2], in May of 2021. 

Unlike the previous initiative, UID 2.0 is completely cookie-independent — and yet it still enables personalized and targeted ads, while also improving privacy controls and data safety for consumers. And it’s completely open-source — anyone can see the UID 2.0 code base on GitHub. 

How Does it Work?

Unified ID 2.0 is supposed to be the only sign-on users have to perform on websites — in place of the cookies that currently remember their log-in and other information. As a result, users will have seamless, easy access to various websites with just a single log-in credential. For publishers and website owners, this makes identifying users simpler as well, across all channels — CTVs, mobile, and desktop. 

When a user logs into a website via UID 2.0, a unique identifier is created for them — in an encrypted, scrambled, and secure form. And to maintain security, the identifier constantly regenerates itself in regular intervals. Plus, consumers can see precisely why and how a website wants to use their personal information at the point of log in — also allowing them to control and set their personal data-sharing policies. 

Features of Unified ID 2.0

The main features of UID 2.0 are:

  • Open-Source and Security 
  • Single Sign-On Authentication
  • Better Publisher[8] Framework
  • Privacy Controls and Transparency[3]

The UID 2.0 framework is non-commercial, open-source, and free for everyone. Furthermore, all login information is hashed and salted — ensuring the safety of user data. Also, Prebid will be responsible for maintaining the open-source nature of UID 2.0 and its infrastructure, decryption, and encryption processes. 

One of the other important points is the SSO — Single Sign-On user-facing component. Criteo has already begun testing the SSO component now called OpenPass, which will create the unique and unified user IDs for targeting purposes. 

This is set to be a great improvement for publishers — providing a streamlined, easy, and clear user interface that enables a better look at data exchange on the Internet; thus increasing user trust. And that’s further cemented by the improved privacy and transparency controls, enabling users to opt out and change their preferences at any time. 

Benefits Of UID 2.0

For publishers, the improved interoperability of the UID 2.0 is the most important feature — it reduces the costs and friction between all ad tech[9] companies, boosting revenues and driving scale easier. Also, crucially: UID 2.0 isn’t reliant on cookies, which is essential because Google will be banning third-party cookies from Chrome in 2022. Considering they’ve cornered the market when it comes to web browsers and search engines, this is a game-changer for everyone. 

On the other hand, the benefits for users are pretty obvious. And apart from the greater transparency and privacy control for them — they also get guaranteed anonymization. They won’t have to wonder about whether their real-life identities are known by any number of third parties — the user ID[10] powered by UID 2.0 is a string of letters and numbers that can’t be connected to real-world identification like addresses or names. All this ID will be used for is ad targeting[4]

Roadblocks Of Unified ID 2.0

The main barrier to the wide adoption UID 2.0 would need to become an industry standard is the fact it depends on email logins for authentication — and getting people to consent to cookies with one click was far easier than getting them to share their emails, even if they have to do it once. 

The Collaboration

To develop the UID 2.0 open-source framework, the Trade Desk is collaborating with leading industry partners. Companies like Nielsen, LiveRamp, Criteo, and Prebid have already signed on to contribute to specific aspects of the development process. 

What’s Next?

In the foreseeable future, The Trade Desk plans to partner with more publishers, advertisers, and supply-side partners. This will make the difficult task of establishing UID 2.0 as the Internet-wide replacement for cookies a little bit easier — though its future is still far from set in stone.

Terms
1. programmatic advertising. Programmatic advertising entails using machine learning and technology suites to buy and sell ad inventory with a data-driven process.
2. Unified ID 2.0. An alternative approach to “cookies” that aims to solve for identity across the open internet, increasing privacy while supporting targeted advertising. UID 2.0 utilizes individuals’ anonymized email addresses; this is gathered by a user logging into an app or website.
3. Transparency. To be considered transparent, a solution provider must fully disclose all components of the buy including pricing, any related mark ups, delivery, placement level media location, inventory type, inventory mix, and how advanced audience data is being applied and reported. Arbitrage and black box inventory solutions are not transparent.
4. ad targeting. The practice of serving an ad to the appropriate audience based on data. Ad targeting can involve demographic, geographical, behavioral or psychographic data.
5. user data. Information about users, either behavioural or demographic. Please note that user data is generally associated with a UUID rather than any personally identifiable information. User data is distinct from contextual data. Often used interchangeably with segment data and audience data.

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